Investors Grapple With the Immigration Crisis

By

Leslie P. Norton

June 21, 2018 12:03 p.m. ET

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Sustainable investors, playing the long game, are engaging with companies to strengthen human-rights practices even after the Trump administration decided to rescind its executive order to separate migrant families at the border, deciding to keep families together in custody.

Sister Nora Nash, who oversees retirement funds for the Sisters of St. Francis of Philadelphia, told Barron’s that she is working with JPMorgan Chase (JPM) and Wells Fargo (WFC), “financial institutions who support legislation on human rights, and asking them to do due diligence on financing prisons.” Earlier this week, Nash says, she had written half a dozen companies, including the two banks, “to ask their CEOs to address the issue at the border.”

Jamie Dimon
Misha Friedman/Bloomberg

After Nash sent the letters, she says, the Business Roundtable—a group of CEOs of major corporations chaired by JPMorgan Chase CEO Jamie Dimon—issued a statement urging the administration “to end immediately the policy of separating accompanied minors from their parents. This practice is cruel and contrary to American values.”

A JPMorgan spokesman shared a letter that Dimon had written to employees, in which he said, “We need to fix our immigration problems—it’s tearing apart our body politic and damaging our economy.” Wells Fargo wasn’t immediately available for comment.

Investors are clearly paying attention. Matt Patsky, CEO of Trillium Asset Management, a sustainable investor, says, “I don’t think there’s an issue that’s galvanized all our investors like this one. We’re looking at every point of leverage to stop these atrocities against an extremely vulnerable population.” The firm is now studying which companies are “running detention centers and financing them,” says Patsky, without revealing any names. Trillium is now contacting clients and asking their permission to involve them in engagement with the companies.

Some sustainably focused investors believe the Trump policy violated the human rights of refugees. Companies that enforced the policy may in turn have exposed themselves to the risk of having violated human-rights norms, says David Schilling, program director at the Interfaith Center on Corporate Responsibility. Schilling and his colleagues have pressed companies and investors to adopt the principles on business and human rights adopted by the United Nations Human Rights Council in 2011, which addresses vulnerable communities like children, women, and migrant workers.

“We’re all making decisions as investors—do we want to be invested in companies supporting this?” says Christine Mendonca, CEO of Humans on the Move, a Tampa, Fla.-based advisory firm that addresses forced displacement.

There are two publicly traded companies that operate detention centers: GEO Group (GEO) and CoreCivic (CXW). A GEO Group spokesman said, “Our company has no involvement in any way with the policy in question, and the facilities we manage do not and have never housed unaccompanied minors.”

In a statement, CoreCivic said that under a longstanding policy, "CoreCivic does not advocate for or against legislation or policies that determine the basis for or duration of an individual’s detention. We also do not enforce immigration laws or policies or have any say whatsoever in an individual’s deportation or release.”

General Dynamics (GD) has also come under fire for its role. In a statement, the company said a General Dynamics unit “provides casework support services to help ensure special needs of unaccompanied children are met. This primarily takes the form of training the case workers.”

General Dynamics said it has worked with the Office of Refugee Resettlement to support unaccompanied minors since 2000 and “has no role in the family separation policy, nor a role in the construction or operation of detention facilities.”

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Investors Grapple With the Immigration Crisis

Sustainable investors, playing the long game, are engaging with companies to strengthen human-rights practices even after the Trump administration decided to rescind its executive order to separate migrant families at the border, deciding to keep families together in custody.

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